tv Fast Money CNBC November 1, 2013 5:00pm-5:31pm EDT
blue chips. and that was the case today. the russell 2,000 down. the dow up 70 points at 15,615. and this as the yield on the ten year note went up another few basis points to 262 today. always a pleasure to have you with us. ready for that twitter ipo. >> very ready. >> that does it for closing bell. thanks for joining us. >> fast money at the nasdaq just uptown starts right now. >> i'm scott cohn at global headquarters, we'll get to fast money in a moment. we want to bring you up to date on the shooting at lax. one tsa officer was killed, multiple others wounded when a gunman blasted his way through security, was carrying a semiautomatic assault rifle. and got almost all the way to the gates at terminal three at lax. the terminal that includes jet blue and virgin american.
seven people were injured in total. six transported to local hospitals. we do not know yet the conditions of any of them, or the condition of the gunman, who has been identified by law enforcement as 23-year-old paul anthony ciancia, a u.s. citizen, who was living in los angeles. he was reported, according to nbc's pete williams to be carrying anti-government materials, which suggests that might be a possible motive, but we do not know. our jane wells on the ground outside lax says that air traffic is starting to return to normal, as law enforcement clears all terminals, because all terminals were evacuated in this incident. that began about shortly before 9:30 this morning, pacific time. some flights now returning, as we can see the map beginning to fill up with flights, coming back. but still, a nationwide ground stop in effect. so flights that were bound for los angeles and had not left yet are being held on the ground. we of course are continuing to
follow the story, as it develops, we will keep you posted. >> live from the nasdaq markets in new york city's times square. this is fast money. america's post market show. i'm melissa lee let's get to our top story, the final stretch, a record run for stocks this year. and on october for the books, year to date the dow up 19%. the s & p 500 up 24%. but with new highs after new highs are there underlying warning signs, that we're getting too frothy, and how should you trade heading into the final stretch of 2013? guy. do you risk missing out on the upside, if you're not in at this point? >> well, obviously, yes. i mean, that risk has been here for quite some time. i think your point about, are there warning signs? i think there are warning signs, we mentioned it last night. to me, it comes in the form of historic margin debt on the new york stock exchange, which is
great, when the market is going higher, but obviously not so good, when it's going down. the last two days, interesting, yesterday you saw the market sell off, then you had the subsequent rally. the last couple months, last six to eight months, those rallies would have extended higher, it didn't. it actually sold off late. today on the other hand, you had every opportunity to push down that 1740 level on the s & p i thought we'd get to this week. looked bad at a certain point today. and then reversed and wound up closing higher. last two days have been extraordinarily confusing. >> bank of america strategist had a note that got a lot of buzz on the trading floor about flows and how this could be a contrarian signal in terms of a sell signal, because if we get another 8 to $9 billion in flows over the next two weeks, to him that's in fact a sign to sell. because the flows have been so strong of late. >> yeah. he's the man, a lot of people follow it. they know where people are positioned. ultimately, if you see where trades are crowded, you know, europe and japan are more crowded trades than the u.s. here. when people look at the u.s.,
there has been talk today, the other thing on the floor, there is numbers out on the valuation of the s & p, it rose 20% this month. that's nowhere near, in other words way beyond what you have seen historically, when you look at complacency level, when you look at bearish levels, the aaii, investor survey that looks out six months. we haven't seen this level of lack of bearishness or low levels ober reading since 2005. leverage on the new york stock exchange, i'm talking prime brokers, leverages on where funds are putting assets to work. we haven't seen this. the ipo schedules. so all of these things tell you, people, consumers, bond flows -- equity flows are places people want to be. >> the other part of that bank of america note was pointing out that fund manager cash levels were high. 4.4% month of october. he says if it goes below 4% in the month of november, that could be a sell signal. this idea there is so much cash on the sidelines may not necessary -- >> unless you get a big in-flow
of retail investors who have cash in the bank and putting it in the market or it comes from the bond market. but i think you need to look at the markets themselves, look at the russell 2,000 this week, three days in a row the russell 2,000 has been down, we're hitting new highs on the s & p 500, it's three days. >> it's been going on a month. this underperformance has been going on a month. the s & p 500 was up three plus whatever percent in october. rut was flat. >> exactly. you need to watch those things. it could say, hey, we are toppy here. we talk about bubbles all the time. depends how you define the bubble. but we are two standard deviations above a long term trend line. that's a bubble in most people's book. >> rotation into year's end, what would you say? >> it's interesting. given the weakness of banks, if the market continues on its trajectory, i think the rotation, the strength you find in the form of these banks. the underperformance with russell may start to
reaccelerate again. but i'm sort of in this camp where we need to have -- i thought it would happen this week, it didn't. we need a meaningful sell off, that means back down to the 1670 level we flagged. and then we'll see what happens if and when it gets here. i think we're sort of in nosebleed territory over the last couple days. >> let's talk about what area of the market some people might think there is a bubble. that is solar. first solar leading the s & p 500 higher today after the company reported a solid quarter that beat expectations, the company is up 92% on the year. it's not the only solar stock on a tear. sun power and solar city have seen pretty big monster rallies. we are on bubble watch with ben, he follows the stocks. great to speak to you again. >> thanks for having me. >> i want to talk about this giant gain we're seeing in first solar. there is chatter on the street maybe earnings quality wasn't as good as it may appear on the surface, there's a one time liability in the quarter. and then also, that there is some pull forward from the fourth quarter. >> both of those are right. the stock was heavily short and had catching up to do.
as you mentioned sun power, my favorite, is up over 400% this year. so first of all, there has been a laggard of the whole group. some was a little spooky of the shorts. >> in terms of the notion that these stocks have run out so much and therefore there is a bubble, is any of that true? i mean, are we in a part evaluation for these particular stocks, where it might not necessarily reflect the fundamentals? although they are good stories. >> so we moved -- we had a big move off the bottom last two years were terrible. a bubble was in 2007. germany and italy and spain. now we have a global market. is it different business? i think there's a lot of gun slinging money out there that chases these stocks. but sun power is a stock you can own for the long term. they built a business, many different channels, global business, profitable business, have a billion dollars liquidity, first solar similar, but one trick pony focused on utilities side.
so i like sun power better. but it's not a bubble in my opinion. we're in the third inning maybe. >> thanks for your time. i'm glad he mentioned 2007, 2008. keep in mind first solar was a $317 stock at its high in 2008. >> sun power i love. because of their exposure in emerging markets. big market for these guys, what ben was talking about, fantastic fundamentals for these guys, bottlenecks. could be something they have to look at. some of the chinese solar stocks have done these round trips two times. so trina was a stock trading down to $5. what's happening in china, they are getting control of inventory. profits there. valuations are not stretched. >> all right. let's move on. market flash, dominic. >> melissa, it's always big numbers when you talk about a stock that trades in six figures. to the headline numbers.
operating earnings per share. class a shares, $2,228 per share. that comes in just shy of analyst estimates for $2,402 per share in operating earnings. on the revenue side, $46.5 billion in revenues, average analyst estimate $44.5 billion in terms of overall sales estimate. book value, always an interesting measure for berkshire hathaway class a shares, because the book value comes in $126,000. remember, warren buffett himself says he'd be willing to pay up to 120% of book value to buy back his own stock, implying a possible buffet floor, if you will, around $152,000, those shares you can see $173,000 per share. >> thanks for that. not many people own the as, but the bs are out there. >> i personally think they are a hard buy. listen, warren, greatest most successful investor. when you talk $173,000, you're
well above what warren buffett would even consider maybe fully valued. so to me, you know, if you're in them, and you have been in berkshire hathaway forever. good for you. i wouldn't be buying here. >> pops and drops. big movers for the week. we have a pop here. >> look what happened, the china pmi is driving momentum. which was already there and a lot of the mining, cliffs, even steel guys continue to stay in the trade. >> all right. we have a drop for dr horton down 6% on the week. >> tough week in home builder space. we saw rates up again. we know what happened in the spring with home builders and home sales. i'd stay away for a little bit. >> drop for lululemon down 8%. >> i liked it for a while. as it gets back toward $65, i think it gets interesting. it's an extraordinarily volatile stock. i understand if you don't want to foray into it. 65 bucks, there's a chance this
makes a push back up to 80 once again. >> ad hoc pop for steve grasso. finally showed up. he made it through traffic, which has been horrendous because of the marathon. he'll join us later on in the show. all right. coming up next, it's time for trade school, ipos with a huge day, one huge one day gains. >> go ahead. try it again. >> tough to figure out. but our traders are on the case. then ever wonder how your phone knows when you turn on the side. a company makes that and other motion tracking technology possible. stock is up 50% this year, talking to the ceo, and we're going to trade that stock straight ahead on fast. really? what's wrong with trying new things? look! mommy's new vacuum! (cat screech) you feel that in your muscles? i do... drink water.
we started off the show, we were missing a trader, look who we have here. >> went to the wrong building i apologize. >> nice. >> it's only been five years on the show. all right. grasso, glad you played it. >> thanks. >> big earnings reports out next week. fast forward to some of the names on our radar, first up luxury retailer michael kors reporting second quarter earnings, the report comes two weeks after coach missed on
revenues and reported biggest drop in north american same store earnings. guy. >> it got added to the s & p. we said don't chase this. i think it was trading up to 78, 79. when that announcement came in. that proved to be somewhat correct. now we are 75.5 again. i liked the name for a long time. valuation isn't completely ridiculous. but the retailers have been having trouble. the comments outs of have i sa and mastercard scare me. i'd rather you let them report, see what they say before you get back in the name. >> next up, can tesla get back in the fast lane? the electric car maker, which fell 17% in october reports third quarter earnings tuesday after the bell. steven grasso. >> look at margins with those credits, those carbon credits or whatever they call them, i'm not sure, but it's 25% with those. it's half of that without. so watch that number. that's really important. >> and finally, high flyer group on set to report third quarter earnings thursday after the bell. that stock is a double in 2013.
beakers. >> this has been an amazing stock that made me look silly. i said sell it several times. i don't really need a lot of help in that department. i can look silly all on my own. when it comes to group on this week. it's a perfect candidate for a stock replacement here. you're up 100% in the stock. sell it. take profit. use options, play it that way into the earnings. >> i don't think your hair cut looks that bad. >> you don't think so? >> not is silly. >> not that bad is not a ringing endorsement. wonder how your phone know when is it's being turned on its side? invent sense is the company behind it. the company is up about 80% since beginning of may. joining us with more on the company and its growth prospects. ceo of invensense. great to have you with us. >> good afternoon. thank. >> you want to talk about the quarter. it was a strong quarter according to analysts, guidance was in fact light versus consensus, the biggest difference in terms of what you
guided, the biggest difference was in gaming, what are you seeing as we go to the fourth quarter which should be a strong season? >> well, typically, both third and fourth quarter have been very strong quarters for us in the gaming business. this year we just happen to be a little bit accelerated. so our strongest quarter as you mentioned happened to be the third quarter. the fourth quarter as we guided the gaming business, gaming consoles haven't been selling that well. that created a challenge for us and head wind. but first calendar quarter coming up, typically has been our weakest quarter. we expect that this time around there won't be as much pressure as we had in previous years, because we're taking all the hit in this current quarter. >> the argument area that doesn't look like it's doing well, when you take a look at your guidance and consensus, are the nonsamsung mobile devices, are we to glean aside from apple and samsung in the marketplace,
everyone else is losing share to them? >> well, that might be true. i don't think they are continuing to lose share, especially in the android market, we have a vibrant market. if you look at china, actually the white box in china which is android is continuing to grow rapidly as the attach rate of these motion sensors continue to proliferate. so in fact, we do see the android market as being very vibrant. it's not really just samsung and apple. and we are very, very strong in the android market, and our market share continues to grow there. >> all right. last quick question. apple, when will you be in apple products? there is report from maximum, and when that report came pout, said you were not in apple products, that your stock sold off. so what can you tell us about that? >> well, we can't say a whole lot about products and customers, that we haven't announced. so we just -- other than we're working very hard to capture that customer. and we're hopeful. but we're working very hard outside that we can't really
report on that. >> you talked about sitting on a t awaiting a customer swing, was that apple? >> we can't talk about any particular customer. but we do have a number of customers, that are ramping up this quarter, as well as next quarter. so all those customers we are hopeful they will be ramping up fairly rapidly in the next few months. >> got it. thanks for joining us. appreciate it. >> all right. thank you. >> the ceo of invensense. >> not terribly priced. around 28 versus it's peers. anywhere from 28 to 40 times. apple is not crucial. in fact a lot of guys on the street that says when this apple hype dies down we get excited. they are taking out more market share with samsung, with android, that's where you should be looking. don't bet on apple and just bet on a company that's executing fourth quarter looks heavy. >> you'll see that back in january, we topped out at 22. had a big selloff, another selloff, moved back up to 22, you have double bottoms, double
tops, 16.5. half of that range is 15 bucks, i think that's where it gets interesting. >> it is the last trading day of the week. the first trading day of the month. final trades coming up next. >> fast money means trading. everybody has got to bring their best information each and every night. the entire trading day is the preparation for the show that night. >> it's idea generation, it's all about giving you a framework for how to look at the market. as the world has changed, our show has evolved. i am guy adami. i am fast money. >> i am pete najarian, i am fast money. >> are you fast money? go to the nbc universal store, and order your fast money tee. run with the big dogs. ♪
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reducing the reimbursement. it doesn't modernize how we drive to higher quality care. >> i think many people, myself included, and i'm certainly not alone in this, are beginning to worry about the consequences how we unwind ourselves from this stuff. >> i would think so. >> and i think that's very important. and we have to understand, there is a risk there. >> i don't want to act like we can win both ways, but in a sense i can. if they keep providing all this liquidity, that's great for the stock market. if they begin to taper, it will be because the economy is doing better, and i get a better e on my earnings front. >> if you look at october, it clearly took a big hit. you saw claims go up quite a lot at the beginning of the month. they started to recover. but they still haven't recovered. to back before they were -- where they were at the beginning. >> instagram, snapshot, vine, twitter, tumbler, like everything. >> but not facebook. >> facebook if i'm bored.
>> back to you. >> when you look what's going on with economic data here and abroad. look what's going on with yields. i said the dollars is going through a five year bull run. it's the trade for the next five years. that's what you watch. >> grasso. >> bob doll had his moment there, we were at 1015 in cash, when he said win win. this is his moment. it's the odds are against him at this point. but i would think -- >> you say he's wrong? >> you know, i think the odds are slightly stacked against him. the market has been bought on every one of these selloffs, if we can get an agreement out of d.c., we can see 1850, 1900. >> the company says it plans to use proceeds to cut debt. miners all down more than 40%
this year. so beakers, you are long gold. >> theoretically, i mean the only problem you have not with all of them but a lot of them, you start to get closer and closer to their cost to pull the stuff out of the ground. and particularly with the junior miners, they get hit even harder. so i would be careful here, although, if we can get some traction in gold, in this environment, the gold miners should outperform. >> good thing is they are starting to cut back production, so that should help prices. >> that's why beaks and i have talked about this on air. that's why the gold miners out perform metal on way up. they have more control other than cost of the metal. >> time for the final trade. let's go around the horn. he was late. but he'll go first. steven grasso. >> hewlett-packard since october 9th or 10th, the stock is up 27% against a backdrop of s & p up 7%, there is something going on other than that navy contract we saw today. >> tim. >> take profits in brazilian
steel. ggb. >> he had to get his money's worth. beakers. >> listen, we are a bit frothy here. and volatility is cheap, buy s & p puts. >> guy. >> new york city marathon, legg mason. >> options action starts right after this. 7 million investors who think like you do. face time and think time make a difference. at edward jones, it's how we make sense of investing. ♪
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for the first time in the 12 year history of the transportation security administration, one of its officers has been killed in the line of duty. this after a shootout at lax, los angeles international airport, just after 9:00 this morning, local time. authorities say that a gunman carrying an assault rifle in a bag, took it out of the bag, blasted his way through security. then was shot in a gun battle with police. the suspect, identified as paul anthony ciancia, 23 years old. u.s. citizen, living in los angeles. apparently originally from pensville, new jersey outside philadelphia. quoting local authorities, and this confirmed by federal authorities, say that